Regulations for the Management of the Various Reserves for Compulsory Automobile Liability Insurance Article 8

For the special reserve set aside by the insurer pursuant to the preceding article, the insurer shall purchase treasury bills or deposit the reserve with a financial institution as a time deposit. Provided that with the approval of the competent authority, the insurer may purchase the following domestic securities:1.Government bonds, not including exchangeable government bonds.2.Financial bonds, negotiable certificates of deposit, banker's acceptances, and commercial paper guaranteed by a financial institution, provided that financial bonds shall be limited to ordinary financial bonds only.The amount of treasury bills purchased or time deposits placed in a financial institution under the preceding paragraph shall not be less than 30 percent of the total amount of the insurer's retained earned pure premiums for this Insurance in the most recent period, as audited or reviewed by a certified public accountant. The competent authority may raise that percentage to a level it deems appropriate based on the insurer's operational status.The financial institution that handles the issuance, acceptance, or guarantee of securities, other than government bonds and treasury bills, purchased by the insurer pursuant to paragraph 1 shall have a long-term credit rating of "twBBB+" or higher from the Taiwan Ratings Corporation, or an equivalent or higher rating from another international credit rating institution acknowledged by the competent authority.If the balance of the insurer's special reserve is less than 30 percent of the total amount of the insurer's retained earned pure premiums for this Insurance in the most recent period, as audited or reviewed by a certified public accountant, then the full amount of its special reserve shall be used to purchase treasury bills or be deposited in a financial institution as a time deposit.